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Swiss bank UBS cuts 5,000 jobs
Swiss bank UBS today said it was axing around 5,500 jobs as it revealed first quarter losses of 11.5 billion Swiss francs (£5.5bn).
The group said it will cut 2,600 jobs in its investment banking arm by the end of the year, with the remaining roles to be trimmed across the business by mid-2009.
It is unclear how many jobs will go in the UK, where UBS employs around 9,000 staff.
Just under a third - some 6,000 - of the group's investment banking team is employed in the UK, but it is understood that the bulk of the job losses will affect UBS's US workforce.
UBS said redundancies would account for most of the investment banking job cuts, but hoped the wider reduction in roles would be achieved through natural turnover.
The bank has been one of the worst affected by the credit crunch, with today's first-quarter net loss coming after a 19 billion US dollar (9.6 billion) writedown in the first three months of the year.
It had already taken an 18.5 billion dollar (9.4 billion) charge from bad investments in last year's results, giving it writedowns of more than 37 billion dollars (19 billion) since last summer.
The first-quarter loss compares with a net profit of 3 billion Swiss francs (1.4 billion) in the same period last year.
Switzerland's largest bank has been struggling to regain investor confidence amid the hefty losses, which has led shareholders to demand radical action to turn the business around.
UBS last month came under pressure from investor and former chief executive Luqman Arnold to break itself up and overhaul the board.
Shareholders approved the appointment of Peter Kurer to replace long-standing chairman Marcel Ospel after he stepped down last month and also gave the green light to a capital increase of 15 billion francs (7.2 billion) as part of a turnaround plan.
It was the second capital injection after UBS raised 13 billion francs (6.3 billion) from two foreign sovereign wealth funds earlier this year. UBS said today it had reduced its exposure to sub-prime-related assets by 60% since the third quarter of 2007.
Chief executive Marcel Rohner said: "We can see tangible effects as a result of our initial responses to the losses. While our exposure is still subject to swings in market conditions, we see market demand for these securities returning in certain areas and at the current level of valuations."
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Friday 25 May 2012
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